Business, consumer tax breaks pass Fla. House

TALLAHASSEE — Tax breaks for consumers and businesses passed in the Florida House on Wednesday and are headed for the Senate.

The House approved another installment of the popular back-to-school sales tax holiday as well as a package of business tax credits and reductions designed to stimulate Florida’s economy.

The sales tax exemption on school supplies, clothing, shoes and related items costing under $15 would be in effect for Aug. 3-5. The bill (HB 737) that passed unanimously would cost the state and local governments an estimated $31.8 million.

The business tax cuts and incentives are expected to cost $121.1 million annually. That bill (HB 7087) passed 92-22 with Republicans, who control the chamber, in favor and Democrats split. Those voting for the bill included Democratic Leader Ron Saunders of Key West.

“This is what we came here to do,” said Rep. Dennis Baxley, R-Ocala. “We came here to make Florida a better place to do business.”

Democrats, though, were still smarting from an anti-union amendment Republicans added Tuesday. It goes to a provision requested by Gov. Rick Scott that would raise the corporate income tax exemption from $25,000 to $50,000. The GOP amendment would limit the higher exemption only to those companies that have no union employees.

The House actually adopted that provision multiple times. Almost every time a Democrat proposed an amendment, House Majority Leader Carlos Lopez-Cantera, R-Miami, offered the anti-union provision as a substitute amendment. Once it passed, that effectively cut off debate on the Democratic amendment.

The rejected Democratic amendments included proposals that would have allowed corporations to benefit from the higher exemption only if they provided health insurance for employees’ same-sex partners and coverage for contraceptives; used a federal database to determine if new hires were illegal immigrants and proved they did not discriminate against veterans in hiring.

The Republicans, though, did permit one Democratic amendment to pass.

It bars corporations that do business with terrorist states from getting the exemption.

Democrats argued the anti-union provision is unconstitutional and predicted it would not be accepted by the Senate. They accused Republicans of partisanship and political gamesmanship.

“It disturbs us that you think just because it comes from the back row that it’s no good,” said Rep. Jim Waldman, D-Coconut Creek. “The reality is we have some really good ideas back here.”

House Speaker Dean Cannon, R-Winter Park, later told reporters it was the Democrats who had injected partisanship.

“I was singularly unimpressed with the Democrats’ attempts yesterday to take a perfectly good bill that deals with getting tax relief to small businesses and trying to inject issues of contraception and gay marriage and a bunch of social issues,” Cannon said.

Some opponents also contended the bill does nothing to help the middle class, but Lopez-Cantera disputed that claim.

“This is not about the big guys, the big corporations, the fat cats,” he said. “This is about jobs.”

The bill includes increased tax credits for business investments in low-income communities and in industrial machinery and equipment. The increased corporate exemption would reduce the number of businesses that pay the 5.5 percent tax from 15,000 to about 11,000. Last year, the Legislature increased the exemption from $5,000 to $25,000, cutting the number of corporations paying the tax in half.

“By allowing more than 3,500 businesses to stop paying income taxes and instead put that money into jobs, and maximizing incentives to make Florida more attractive to quality manufacturing jobs, the Florida House has demonstrated it knows what it takes to help grow private-sector jobs,” Scott said in a statement.

The Republican governor had pushed for a phase-out of the tax, which brings in about $2 billion a year, while campaigning in 2010. Facing a potential budget deficit last year, lawmakers balked Scott’s proposal to cut the tax rate and agreed only to the higher exemption at a relatively small cost of $30 million. This year, Scott scaled back his request to another exemption increase. It is expected to cost another $30 million.

Less than 1 percent of Florida’s businesses pay the tax. Most Florida-based companies fall under an exemption for corporations with 75 or fewer stockholders.

The House voted 80-36 for another tax bill (HB 87) designed to provide an incentive for oil companies to tap into old fields in the Panhandle and southwest Florida. The measure would reduce severance taxes to offset the higher cost of new technology needed to extract the hard-to-get oil remaining in those fields. The bill now goes to the Senate.

A proposed state constitutional amendment (HJR 93) passed unanimously. It would provide an additional homeowner property tax exemption for the surviving spouses of service members who die while on active duty and for police, correctional officers, firefighters, paramedics and emergency medical technicians who die in the line of duty.

If the Senate passes the amendment it would go on the November ballot where it would need 60 percent voter approval.